Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › amortisation of internely generated goodwill
- This topic has 4 replies, 2 voices, and was last updated 9 years ago by MikeLittle.
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- November 27, 2014 at 4:18 pm #213877
Hi sir, can we amortise internely generated goodwill and deduct amortisation of parents share from consolidated retained earnings?
November 27, 2014 at 4:25 pm #213883In what situation have you managed to recognize internally generated goodwill?
Simply, no. Because internally generated goodwill should never have made it through the maze to be recognised, and therefore it can’t be amortised
November 27, 2014 at 4:32 pm #213886In question 1 of 2007 at Kaplan answers they deducted it from consolidated earnings, the reason they used internely generated goodwill can only be recognized in accordance with IFRS 3 if subsidiary can measure it! I am confused how did they deduct it?
November 27, 2014 at 4:34 pm #213888The question is called GLOVE from June 2007
November 29, 2014 at 10:47 am #214278I can only presume that it was deducted from earnings because it shouldn’t have ever been created in the first place
For your purposes in 11 days’ time, let’s accept that internally generated goodwill will not appear and, in the unlikely event that it does appear, you now know to get rid of it by reducing retained earnings
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